KEY KNOWLEDGE
Chapter 1-4 7 questions/ chapter
Chapter 5-6 6 questions/ chapter
Chapter 1: OVERVIEW ABOUT INTERNATIONAL BUSINESS MANAGEMENT
1.1. Differences between Domestics Business and International Business?
1.2. Globalization, facets of globalization (globalization of market, globalization of
production).
1.3. Global institutions: GATT, WTO, IMF, World bank, UN
1.4. Drivers of global institutions: decline trade and investment barriers, technology change.
Chapter 2: INTERNATIONAL BUSINESS ENVIRONMENT
2.1. PESTEL model
- Political (Democracy >< Totalitarian, Collectivism >< Individualism)
- Economic system (Command Economy, Mixed Economy, Market Economy)
- Legal
+ Common Law, Civil Law, Theocratic law
+ Intellectual property: Patent, Copyright, Trademark
2.2. Culture (norms and values, determinant of culture)
2.3. Religious and Ethical Systems (Christianity, Islam, Hinduism, Buddhism,
Confucianism)
Chapter 3: INTERNATIONAL BUSINESS STRATEGY
3.1. Corporate Strategy
- Support Activities (Information system, Company Infrastructure Logistics,
Human Resources).
- Primary Activities (R&D, Production, Marketing and Sales, Customer Service).
3.2. International Business Strategy
Chapter 4: METHODS OF ENTERING THE WORLD MARKET
4.1. Entry modes
- Exporting
- Turnkey projects
- Licensing
- Franchasing
- Joint ventures
- Wholly owned subsidiaries
+ A greenfield venture: Set up a new operation in a foreign country.
+ Acquisition: Acquire an established firm in the host nation
4.2. Alliance
- Success of an alliance: partner selection, alliance structure, the manner in which the
alliance is managed
Chapter 5. ORGANIZATION OF INTERNATIONAL BUSINESS
5.1. Organizational Structure:
- Vertical Differentiation (Centralization, Decentralization)
- Horizontal Differentiation (International Division, Worldwide Area Structure,
Worldwide Product Divisional Structure, Global Matrix Structure)
- International Strategy and Coordination:
Global
Localization International Transnational
Strategy Standardization
strategy Strategy Strategy
strategy
Coordination Lowest Average High Highest
- Integrating Mechanisms:
+ Formal Integrating Mechanisms: Direct contact<< Lianson roles<< Teams<<
Matrix Structures (Increase complexity).
+ Informal Integrating Mechanism: Management Network, Organizational culture.
5.2. Control system
- Personal controls, Bureaucratic controls, Output controls, Cultural controls
Chapter 6: GLOBAL HUMAN RESOURCE MANAGEMENT
6.1. Staffing Policy
- Ethnocentric
- Polycentric
- Geocentric
6.2. Expatriate managers
- Four dimensions lead to success in a foreign posting: Self-Orientation, Others-
Orientation, Perceptual Ability, Cultural toughness
- Training for expatriate managers: Culture, Language, Practical training.
